In a world where economic certainties are wavering, the Paris Stock Exchange seems to ignore realities with the appetite of an ogre. Friday February 23, 2024, the CAC 40 once again panicked the counters to register an unprecedented level at 7976 points! Coming close to the very symbolic bar of 8000 points.
The incandescence of the stock market
In the Parisian trading rooms, the atmosphere is incandescent. Brokers are snapping up technology stocks, galvanized by the stratospheric performance of the juggernaut Nvidia. Following the publication of record results, the stock of the specialist in electronic chips for artificial intelligence jumped 16.4% on Thursday, swelling its stock market by $277 billion in a single day. A staggering feat for this Californian company, whose valuation has now crossed the 2,000 billion mark, making it the 3rd most capitalized heavyweight on Wall Street.
Driven by this bullish tidal wave across the Atlantic, the flagship index of the Paris stock market has continued to climb in recent days, recording an increase of more than 5.6% since January 1, 2024. dazzling trajectory which does not seem to want to stop, in a context which is far from idyllic for the French economy.
The factors of a lasting outbreak
Several factors are indeed fueling the ambient optimism on the stock markets. On the one hand, the US Federal Reserve has clearly signaled a potential easing of its monetary policy in the coming months, paving the way for a new cycle of rate cuts. Very pleasant music to the ears of the managers.
Furthermore, financial markets have been enthusiastic about recent signs of a decline in inflation in the United States and Europe. A trend which, if confirmed, could allow central banks to be more accommodating with the restrictive monetary policy pursued so far.
Finally, investors’ voracious appetite for AI-related technology stocks provides powerful fuel for the rise in indices, like the Parisian CAC 40. The enthusiasm does not seem about to die down for this promising sector with stellar growth prospects.
If the current euphoria of the stock market may make economists cringe a few teeth, investors seem determined to take advantage of it as long as the dynamics are favorable. The CAC 40, driven by the wind of optimism blowing from the United States, seems set to soon cross the highly symbolic bar of 8,000 points, even if it means moving further and further away from the realities of a broken French economy. .
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